Dollar squeeze

10 December, 2015

Dollar shorts continue to be squeezed as the dollar index looks to be going to record its second weekly decline in a row. Failure at resistance just above the 100.00 level for the second time this year has formed a big double top fuelling calls for further weakness as investors bake in the highly expected rate hike form the Federal Reserve next week. It’s the majors that are making the most ground against the greenback with stronger than expected Australian unemployment data giving AUDUSD a boost, meanwhile EURUSD recaptured the 1.1000 level yesterday trading just below there at 1.0990 at the time of writing and GBPUSD is just below 1.5200. Even the cut in interest rates from the RBNZ overnight from 2.75% to 2.50% hasn’t dented strength in NZDUSD.

All eyes on the Bank of England today, but ahead of then the SNB makes its policy decision where it’s expected to keep the base rate at -0.75%. For the BOE the focus will be not just on the minutes and how the MPC votes, but on the outlook for inflation which continues to bump along just above 0%. There are many diverse views on when the BOE will hike rates for the first time and if indeed it will be in 2016, but the move in sterling yesterday just reminded investors that if the Fed moves next week, the BOE may not be all that far behind in commencing its tightening cycle.


Source link  
Fed Holds Rates for Now But...

Unsurprisingly, the Federal Reserve kept rates on hold following the end of its 2-day meeting on Wednesday. They did, however, indicate that...

UK Unemployment at 42 Year Low

UK unemployment fell to its lowest level since 1975, data on Wednesday revealed. Unemployment fell by 75K, bringing the unemployment...

US Equities at Record Levels

US equities closed at record levels on Wednesday, as improved risk-on sentiment returned to the markets and news that the US economy...


USD Stabilizes

Hurricane Irma has, reportedly, inflicted less damage on the US mainland than was originally predicted, thereby reducing the economic impact of the devastation it was expected to...

Markets on Edge

With the markets risk appetite dampened after North Korea’s most powerful nuclear test to date, USD and Global equities fell whilst Gold, Yen and Sovereign Bonds all rose....

Risk Appetite Returns

North Korea official news agency reported on Monday that leader Kim Jong Un will watch the actions of the United States for a while longer before making a decision to fire missiles at Guam...


US-Korean Tensions Rattle Markets

Markets were cautious on Wednesday, as safe-haven assets pushed higher after tensions grew between the US and North Korea. Markets are concerned...

Global Manufacturing Grows

Recent data releases have shown that global manufacturing saw an increase in July, further confirming global economic momentum has carried into H2...

All Eyes on Central Banks

Markets were, for the most part, little changed on Wednesday as traders waited for today’s Bank of Japan and ECB rate decisions. Earlier today...

  


Share: